Mortgage Refi Applications Up 9.4% on Record Low Rates

Mortgage applications for both refinancing and purchases jumped 7.5 percent last week, from one week earlier, as long-term interest rates set record lows, according to the Mortgage Bankers Association.
The MBA’s Market Composite Index, a measure of mortgage loan application volume, increased 7.5 percent on a seasonally adjusted basis
The refinancing component of the index increased 9.4 percent from the previous week, while the portion that measures applications for purchases increased just 0.1 percent.
Last week, the 30-year fixed rate mortgage slipped to a new record low of 3.87 percent, after setting the previous low of 3.89 last month, according to Freddie Mac.
The MBA reported that its four-week moving average for the seasonally adjusted overall market index is up 4.88 percent.
The refinance share of mortgage activity increased to 80.5 percent of total applications from 80.0 percent the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 6.0 percent from 5.6 percent of total applications from the previous week.
Here’s the MBA’s overview of average contract interest rates:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 4.05 percent, the lowest rate in the history of the survey, from 4.09 percent, with points increasing to 0.44 from 0.41 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.  The effective rate also decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.29 percent, the lowest rate in the history of the survey, from 4.33 percent, with points increasing to 0.43 from 0.41 (including the origination fee) for 80 percent LTV ratio loans.  The effective rate also decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.89 percent, the lowest rate in the history of the survey, from 3.96 percent, with points increasing to 0.78 from 0.61 (including the origination fee) for 80 percent LTV ratio loans.  The effective rate also decreased from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.33 percent, the lowest rate in the history of the survey, from 3.36 percent, with points decreasing to 0.37 from 0.41 (including the origination fee) for 80 percent LTV loans. The effective rate also decreased from last week.
  • The average contract interest rate for 5/1 ARMs decreased to 2.91 percent from 2.94 percent, with points increasing to 0.40 from 0.39 (including the origination fee) for 80 percent LTV ratio loans.  The effective rate also decreased from last week.

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